The internet and rapidly evolving digital landscape has revolutionised the way people buy and sell properties.
With some reports suggesting 95 per cent of house buyers start their search for their new property online, estate agents have had to adapt quickly to remain competitive.
But when it comes to selling properties online, how can estate agents ensure they are operating legally and fairly?
Clear picture: Estate and letting agents have to adhere to the Consumer Protection from Unfair Trading Regulations 2008. As well as disclosing “fair” information about a property and not deliberately misleading or withholding information from buyers, they must also provide “accurate descriptions of properties they are marketing”. This means photos and descriptions should offer a fair representation of the property and not be edited to make it appear better than it actually is.
Transparent fees: In May this year there were reports that the Advertising Standards Authority was to investigate online agents that failed to include VAT in their fees, despite guidance from the Committee of Advertising Practice and The Property Ombudsman advising them to include the tax. Under the Consumer Rights Act 2015, letting agents must clearly display a list of their fees on their website, as well as at each of their offices. As well as facing fines of up to £5,000, agents failing to adhere to the rules also risk negative publicity and media attention - as seen in this recent case.
Know your competition (law): Last month (June 2015) the Competition and Markets Authority (CMA) sent warning letters to estate and letting agents reminding them not to be involved in anti-competitive agreements to restrict the advertising of fees. The caution followed a recent case where the CMA fined several estate agents and a newspaper publisher for restricting the advertising of fees or discounts in a local newspaper. While this case involved print media, such competition law is still relevant for online activities.
Failing to adhere to legislation and guidelines could result in fines, a ban from practicing and even imprisonment – but another issue estate and letting agents need to consider is their reputation, both on and offline. Whether a humorous article about terrible property photos or a social media battle between an estate agent and a disgruntled customer, the internet can quickly expose businesses’ failings and ruin their brand in an instant.
Of course, most of the points above apply to high street estate and letting agents, not just those who have a presence online. With the law constantly evolving to keep up with the changing market and technologies, estate and letting agents need to keep up to date with any new guidelines to ensure they are operating legally, fairly and competitively.
*Rachel Haymes is head of conveyancing at Ratio Law